Fundamental Principles of Accounting Essay Example | Topics and Well Written Essays - 250 words

Fundamental Principles of Accounting - Essay Example Principles of accounting dictate that for losses to be incurred, institutions do not meet the breakeven point. The breakeven point ensures a company to pay all the bills while ensuring the business continues running (Wagner & Dittmar, 2006). Financial analysis is also important in the scenario presented by the two cases. Forecasting is clear in the two cases and both companies had a strategy placed on the set objectives. Agents of accounting such as profits, losses, liabilities, expenditure, and other financial statements come in handy in ensuring the success of the set objectives. The ability to access the stability, viability, and the profitability of a company is evident in both cases. The role of decision making in financial assessment is also evident in both cases. This is because it dictates the continuity or discontinuity of the operational department of a business. The cases display proper ability to make purchases of given materials while providing consumers with products. In the long run, the company benefits from the profits, solvency, stability and liquidity of assets (Wagner & Dittmar,